When we talk about the “generation gap” it is usually an indication of a difference in mentalities towards culture, technology, and certain values. But a new report from the advocacy group Young Invincibles shows that the millennial generation is suffering significantly bigger generation gap: a gap worth about $10,000.
The report shows that those between the ages of 25 and 34 were earning about $50,910, on average, in 1989. The same target age range, in 2013 was earning, on average, about $40,581.
That is a decline of about 20 percent!
Perhaps more importantly, though, the report finds that this generation has a net wealth equal to only about half of that of their parents at the same age. In addition, the reports suggests that when baby boomers were at this age, they had twice the number of assets that millennials have today.
According to Tom Allison, who is the Deputy Director of Policy and Research for Young Invincibles, “These findings uncover that Millennials have been set back significantly, by not just the Great Recession but by decades-long financial trends, resulting in major generational declines in financial security between Millennials and Baby Boomers when they were the same age.”
We can extract, then, that the old formula of “education + hard work = financial stability” simply is not working. It is outdated. Perhaps this might be due to the fact that young people are simply expected to finish college and then compete for the same jobs—but the cost of education is skyrocketing inversely to the plummeting of high-paying job opportunities.
Indeed, there is evidence that a non-degree bank teller job a generation ago would have started at a [adjusted] salary of about $19,500; but a college graduate, today, might end up working at a restaurant for only $18,000.
Thus, the median [college-educated] Millennial is only earning, perhaps, slightly more than a baby boomer did—even without a degree—but Millennials have to pay off ridiculously student loans and are dealing with continuous increases to cost of living.
Allison goes on to warn: “The challenges that young adults face today could forecast the challenges that we see down the road.”